Of course, if didn't hurt that France, Germany and England won in years in which they were hosting. The construction of new stadiums and other preparations no doubt boosted each, if only temporarily. Still, the phenomenon intrigues economists around the world -- especially ones who are rabid football fans.
By that measure, bookmakers thinking Japan has a greater chance of winning the World Cup than Korea may be wrong. According to UK bookmakers William Hill, odds that Japan will win are 66 to 1. Though Korea's odds are far worse -- 150 to 1 -- its stock market is up 24 percent so far this year. Japan's is up just over 11 percent. Bottom line, if stocks are any guide, Korea may have a better World Cup than Japan.
The fact that the smart money is on Argentina flies in the face of the World Cup as an economic indicator. Still, investors may be putting dollars on them as 4-to-1 joint favorite to try to win back the billions lost on the devalued peso.
In fact, the World Cup may hurt Japan's economy more than help it. Economists' predictions for how much the event will boost GDP in the April-to-June quarter generally fall between 0.1 percent to 0.3 percent. That means GDP -- both in real and nominal terms -- will probably still be negative this year.
A World Cup boost already has come from public works projects related to the event, O'Neill says. Seven new stadiums were built at a cost of roughly US$1.6 billion, much of it financed with debt.
Many are sprawling multi-function sports complexes that cost far more than basic football arenas. After the World Cup, local authorities will find themselves heavily indebted and shackled with massive stadiums that may never be sold out again.
Here in Korea, meanwhile, officials seem to have their eyes on the long-term payoff: Branding. Sure, the 1 percent boost to GDP estimated by the state-run Korea Development Institute will help. But it's the opportunity to showcase the new, vibrant Korea that interests the government. This is, after all, the nation's biggest sporting event since the 1988 Summer Olympics.
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